Is solar power mainstream now?

Shayle Kann, the senior vice president of research at leading cleantech market research firm GTM Research, has laid out four key markers that he thinks need to be reached in order for solar power to be considered "mainstream" in the United States. In the video below, he and Greentech Media reporter Stephen Lacey go down that list and take a stab at where they think we stand today. Following the video, I'll chime in with some unsolicited commentary and critiques regarding Kann's list, and my own opinions on where we stand today.

Before watching the video, be sure to check out and digest these four key markers that Shayle has come up with:

1. Solar power must be a primary source of new electric capacity.

2. Solar power must be cost-competitive without reliance on fickle incentives.

3. Solar power must be taken seriously by the electricity industry.

4. Solar power must be "bankable."

I think Kann and Lacey are right on the money in pointing out that 1) solar power is now a primary source of new electricity capacity, the 2nd-largest in 2013, 2) utilities are paying close attention to solar (and even trying to slow its growth in some cases), 3) solar is already cost-competitive in some places without "fickle" subsidies, and 4) solar is about halfway towards "bankable" in the narrow way they are using that term.

However, I think there's also a lot of hidden complexity here.

First of all, the US electricity market is a very disconnected "market" and the degree to which solar is "mainstream" or not varies greatly from state to state. While solar is mainstream or on the verge of being mainstream in California, Hawaii, New Jersey, Arizona, and some other states; it is not being installed to nearly the same degree in states such as Texas, Florida (the "Sunshine State"), North Dakota, and many others. Based on the latest annual data, Arizona has 98 times more solar power installed per capita than Missouri, the state that falls right in the middle of this state ranking (#26) if you also include Washington, DC. In other words, it might be common to see solar panels on roofs while biking through the neighborhoods of some states, but you'd have to look long and hard to find a single solar panel in the majority of American states. I don't think you can call solar power mainstream in most of the US yet.

On the opposite side of things, however, I have an issue with Kann's "cost-competitive" and "bankable" conclusions. If we're talking about utility-scale solar projects, Kann nailed it. However, if we take a look at the residential solar story, some key points are overlooked (as they almost always are).

The root point that I think is overlooked is that residential solar power competes with retail (not wholesale) electricity prices. Retail electricity is, of course, much more expensive than wholesale electricity, so residential solar power becomes "cost-competitive" earlier than utility-scale solar power. If you look at rooftop solar in investment terms and do the math, solar offers a great return on investment in most states. In 13 states, it beats the S&P 500! In another 20 states, it beats 30-year US Treasury bonds. And in another 10 states, it beats 5-year CDs. In other words, solar is a very cost-competitive and bankable investment option across the US. (Yes, these findings are based on solar incentives that are in place today, but the story wouldn't change much if you removed "fickle" incentives from the equation.)

1) solar power is only "mainstream" in a handful of states, but 2) solar power is cost-competitive across the US, and we should make more people aware of that so that they and the world can benefit from going solar.